House Bill 607

AN ACT TO AMEND SECTION 27-69-13, MISSISSIPPI CODE OF 1972,
TO INCREASE THE EXCISE TAX ON TOBACCO PRODUCTS; TO SPECIFY THE AMOUNT OF THE
DISCOUNT OR COMPENSATION ON THE ADDITIONAL FACE VALUE OF STAMPS PURCHASED BY
DEALERS TO COMPLY WITH THE TAX INCREASE PROVIDED FOR BY THIS ACT; TO AMEND
SECTION 27-69-75, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE REVENUE DERIVED
FROM THE TAX INCREASE PROVIDED FOR BY THIS ACT SHALL BE DEPOSITED INTO SPECIAL
FUNDS IN THE STATE TREASURY TO THE CREDIT OF THE UNIVERSITY OF MISSISSIPPI
MEDICAL CENTER, THE STATE DEPARTMENT OF EDUCATION, THE STATE VETERANS AFFAIRS
BOARD, THE STATE INSTITUTIONS OF HIGHER LEARNING AND THE GOVERNOR'S OFFICE-DIVISION
OF MEDICAID, NOT TO EXCEED A MAXIMUM AMOUNT OF THE REVENUE COLLECTED DURING ANY
FISCAL YEAR FOR EACH FUND; TO SPECIFY THE PURPOSES FOR WHICH THE MONIES IN EACH
SPECIAL FUND MAY BE EXPENDED; TO AMEND SECTION 27-69-31, MISSISSIPPI CODE OF
1972, TO CONFORM TO THE PRECEDING PROVISIONS; TO PROVIDE THAT THIS ACT WILL
STAND REPEALED ON JULY 1, 2011; AND FOR RELATED PURPOSES.

27-69-13.
(1) There is * * * imposed, levied
and assessed, to be collected and paid as hereinafter provided in this chapter,
an excise tax on each person or dealer in cigarettes, cigars, stogies, snuff,
chewing tobacco, and smoking tobacco, or substitutes therefor, upon the sale,
use, consumption, handling or distribution in the State of Mississippi, as
follows:

(a)
On cigarettes, the rate of tax shall be Eighteen-twentieths of One Cent
(18/20 of 1˘) on each cigarette sold with a maximum length of one hundred
twenty (120) millimeters; any cigarette in excess of this length shall be taxed
as if it were two (2) or more cigarettes.
* * * However, if
the federal tax rate on cigarettes in effect on July 1, 1985, is
reduced, then the rate as provided in this paragraph (a) shall be
increased by the amount of the federal tax reduction. That tax increase shall take effect on
the first day of the month following the effective date of the reduction
in the federal tax rate.

(b)
(i) In addition to the excise
tax levied by paragraph (a), there is levied an excise tax of Two and One-half
Cents (2-1/2˘) on each cigarette sold with a maximum length of one hundred
twenty (120) millimeters; any cigarette in excess of this length shall be taxed
as if it were two (2) or more cigarettes.

(ii) On or before the fifteenth of August 2003, and each succeeding
month thereafter, the revenue derived from the excise tax on cigarettes that is
levied by subparagraph (i) of this paragraph shall be deposited into the
appropriate funds in the State Treasury as provided in Section 27-69-75.

(c) On cigars, cheroots, stogies, snuff, chewing and smoking tobacco
and all other tobacco products except cigarettes, the rate of tax shall be
fifteen percent (15%) of the manufacturer's list price.

(d) (i) In addition to the
excise tax levied by paragraph (c), there is levied an excise tax of five
percent (5%) of the manufacturer's list price on cigars, cheroots, stogies,
snuff, chewing and smoking tobacco and all other tobacco products, except
cigarettes.

(ii) On or before the fifteenth day of August
2003, and each succeeding month thereafter, the revenue derived from the excise
tax on other tobacco products, except cigarettes, that is levied by
subparagraph (i) of this paragraph shall be deposited into the appropriate
funds in the State Treasury as provided in Section 27-69-75.

(2)
No stamp evidencing the tax * * *
levied on cigarettes by this section shall be of a denomination of less
than One Cent (1˘), and whenever the tax computed at the rates * * * prescribed on
cigarettes in this section is a specified amount, plus a fractional part
of One Cent (1˘), the package shall be stamped for the next full cent. However, (a) the additional face
value of stamps purchased to comply with taxes imposed by subsection (1)(a)
and subsection (1)(c) of this section after June 1, 1985, shall be subject
to a four percent (4%) discount or compensation to dealers for their services
rather than the eight percent (8%) discount or compensation allowed by Section
27-69-31; and (b) the additional face value of stamps purchased to comply
with taxes imposed by subsection (1)(b) and subsection (1)(d) of this section
after July 1, 2003, shall be subject to a three percent (3%) discount or
compensation to dealers for their services rather than the eight percent (8%)
discount or compensation allowed by Section 27-69-31.

(3)
Every wholesaler shall purchase stamps as provided in this chapter, and
affix the same to all packages of cigarettes handled by him as * * * provided in
this section.

(4)
The * * * tax levied
by this chapter is levied upon the sale, use, gift, possession, or
consumption of tobacco within the State of Mississippi, and the impact of the
tax levied by this chapter is * * *
declared to be on the vendee, user, consumer, or possessor of tobacco in this
state. When the tax is
paid by any other person, the payment shall be considered as an advance
payment and shall thereafter be added to the price of the tobacco and recovered
from the ultimate consumer or user.

27-69-75.
(1) All taxes levied by
this chapter shall be payable to the commissioner in cash, or by personal
check, cashier's check, bank exchange, post-office money order or express money
order, and shall be deposited by the commissioner in the State Treasury on the
same day collected. No remittance other
than cash shall be a final discharge of liability for the tax * * * assessed and
levied under this chapter, unless and until it has been paid in cash to
the commissioner.

(2)
The revenue derived from the taxes levied in Sections 27-69-13(1)(b) and
27-69-13(1)(d) shall be deposited into the State Treasury, as follows:

(a) Fifteen percent (15%) of the revenue collected, not to exceed
Eighteen Million Dollars ($18,000,000.00) of the revenue collected during any
fiscal year, shall be deposited in the special fund to the credit of the
University of Mississippi Medical Center that is created by Section 4(1) of
this act.

(b) Seven percent (7%) of the revenue collected, not to exceed Eight
Million Dollars ($8,000,000.00) of the revenue collected during any fiscal
year, shall be deposited in the special fund to the credit of the University of
Mississippi Medical Center that is created by Section 4(2) of this act.

(c) Twenty-five percent (25%) of the revenue collected, not to exceed
Thirty-one Million Dollars ($31,000,000.00) of the revenue collected during any
fiscal year, shall be deposited in the special fund to the credit of the State
Department of Education that is created by Section 4(3) of this act.

(d) Four percent (4%) of the revenue collected, not to exceed Five
Million Dollars ($5,000,000.00) of the revenue collected during any fiscal
year, shall be deposited in the special fund to the credit of the State
Veterans Affairs Board that is created by Section 4(4) of this act.

(e) Thirteen percent (13%) of the revenue collected, not to exceed
Sixteen Million Dollars ($16,000,000.00) of the revenue collected during any
fiscal year, shall be deposited in the special fund to the credit of the state
institutions of higher learning that is created by Section 4(5) of this act.

(f) Twenty percent (20%) of the revenue collected, not to exceed
Twenty-five Million Dollars ($25,000,000.00) of the revenue collected during
any fiscal year, shall be deposited in the special fund in the State Treasury
to the credit of the Governor's Office-Division of Medicaid to be expended by
the division for the purposes authorized under the Mississippi Medicaid Law.

(g) Any amount of the revenue collected that exceeds the amounts
required to be deposited into the special funds as provided in paragraphs (a)
through (f) of this subsection shall be deposited into the State General
Fund. However, if at the end of any
fiscal year, the total amount of revenue deposited into any of the special
funds as provided in paragraphs (a) through (f) of this subsection is less than
the maximum dollar amount that may be deposited into any such special fund
during a fiscal year, then the State Fiscal Officer shall transfer from the
revenue deposited into the State General Fund under this paragraph (g) an
amount necessary to ensure the deposit of the maximum dollar amounts into each
of the special funds as provided in paragraphs (a) through (f) of this
subsection.

(3)
All tobacco taxes collected, including tobacco license taxes, except
for those revenues required to be deposited into the special funds as provided
in paragraphs (a) through (f) of subsection (2) of this section, shall be
deposited into the State Treasury to the credit of the General Fund.

(4)
Wholesalers who are entitled to purchase stamps at a discount, as
provided by Section 27-69-31, may have consigned to them, without advance
payment, those stamps, if and when the wholesaler * * * gives to
the commissioner a good and sufficient bond executed by some surety company
authorized to do business in this state, conditioned to secure the payment for
the stamps so consigned. The
commissioner shall require payment for those stamps not later than
thirty (30) days from the date the stamps were consigned.

27-69-31.
Dealers subject to the provisions of this chapter shall be allowed, as
compensation for their services in affixing the stamps * * * required by this chapter, a sum equal to
eight percent (8%) of the face value of the stamps purchased by them,
except as otherwise provided in Section 27-69-13(2); however, the
commission shall allow no discount on the purchase of stamps by wholesalers of
an aggregate amount of less than One Hundred Dollars ($100.00), and by
retailers of an aggregate amount of less than Fifty Dollars ($50.00) in any one
order.

It is further provided that the
commissioner may, in his discretion, either reduce the compensation allowed, or
disallow any compensation for the affixing of stamps, for failure of the
dealer to comply with any provisions of the law or rules and regulations
promulgated by the commissioner.

This
section shall stand repealed on July 1, 2011.

SECTION 4. (1)
(a) There is created in the
State Treasury a special fund to the credit of the University of Mississippi
Medical Center, which shall be comprised of the monies required to be deposited
into the fund under Section 27-69-75(2)(a), and any other funds that may be
made available for the fund by the Legislature.

(b)
Monies in the fund shall be expended by the University of Mississippi
Medical Center, upon appropriation by the Legislature, for the training of,
physicians, dentists, nurses and other health care professionals and allied
health personnel at the School of Medicine, the School of Dentistry, the School
of Nursing and the School of Health Related Professions.

(c)
Unexpended amounts remaining in the
special fund at the end of a fiscal year shall not lapse into the State General
Fund, and any interest earned or investment earnings on amounts in the special
fund shall be deposited to the credit of the special fund.

(2) (a)
There is created in the State Treasury a special fund to the credit of
the University of Mississippi Medical Center, which shall be comprised of the
monies required to be deposited into the fund under Section 27-69-75(2)(b), and
any other funds that may be made available for the fund by the
Legislature.

(b) Monies in the fund shall be expended by the
University of Mississippi Medical Center, upon appropriation by the
Legislature, for expansion of the "A Comprehensive Tobacco Program"
(ACT Program) administered by the University of Mississippi Medical
Center.

(c) Unexpended
amounts remaining in the special fund at the end of a fiscal year shall not
lapse into the State General Fund, and any interest earned or investment
earnings on amounts in the special fund shall be deposited to the credit of the
special fund.

(3)
(a) There is created in the
State Treasury a special fund to the credit of the State Department of
Education, which shall be comprised of the monies required to be deposited into
the fund under Section 27-69-75(2)(c), and any other funds that may be made
available for the fund by the Legislature.

(b)
Monies in the fund shall be distributed by the State Department of
Education, upon appropriation by the Legislature, to the public school
districts of the state for purchasing textbooks and classroom supplies.

(c)
Unexpended amounts remaining in the
special fund at the end of a fiscal year shall not lapse into the State General
Fund, and any interest earned or investment earnings on amounts in the special
fund shall be deposited to the credit of the special fund.

(4)
(a) There is created in the
State Treasury a special fund to the credit of the State Veterans Affairs Board,
which shall be comprised of the monies required to be deposited into the fund
under Section 27-69-75(2)(d), and any other funds that may be made available
for the fund by the Legislature.

(b)
Monies in the fund shall be expended by the State Veterans Affairs
Board, upon appropriation by the Legislature, for funding the increased costs to the board of operating and
maintaining the state veterans homes located in Jackson, Kosciusko and Oxford,
Mississippi, which were previously managed by third parties under contract with
the board.

(c)
Unexpended amounts remaining in the
special fund at the end of a fiscal year shall not lapse into the State General
Fund, and any interest earned or investment earnings on amounts in the special
fund shall be deposited to the credit of the special fund.

(5)
(a) There is created in the
State Treasury a special fund to the credit of the state institutions of higher
learning, which shall be comprised of the monies required to be deposited into
the fund under Section 27-69-75(2)(e), and any other funds that may be made
available for the fund by the Legislature.

(b)
Monies in the fund shall be allocated equally among the University of
Mississippi, Mississippi State University, Mississippi University for Women,
the University of Southern Mississippi, Delta State University, Alcorn State
University, Jackson State University and Mississippi Valley State University,
and expended by the state institutions of higher learning, upon appropriation
by the Legislature, for health care purposes such as health care services for
students, funding educational and research programs for the training of
students preparing for careers in the various health care professions and
occupations and funding any other educational and research programs relating to
health care.

(c)
Unexpended amounts remaining in the
special fund at the end of a fiscal year shall not lapse into the State General
Fund, and any interest earned or investment earnings on amounts in the special
fund shall be deposited to the credit of the special fund.

(6) This section shall stand repealed on
July 1, 2011.

SECTION 5. This act shall take effect and be in force from and after July 1,
2003.